2-4-2019; City of Chicago's Missing-In-Action WC Defense Program--KCB&A Can Help; Older Job Applicants Cannot Sue for Disparate Impact Age Discrimination by Brad Smith + more

Synopsis: The City of Chicago’s MIA or Missing in Action WC Defense Program Needs HELP!!!

Editor’s comment: KCB&A is here to help rebuild and improve their program, if they want help. Our defense team has the knowledge, guts and drive to do this job right.

While we don’t have a view into the specific inner workings at the City, something isn’t going right if the program is in the shape that it appears to be. A 2016 analysis indicated the City was spending over $100M that year in WC costs/benefits—that number is probably higher today. In our view, that high cost can be dramatically cut while, at the same time, injured City of Chicago workers will still be cared for. We feel all the current Chicago mayoral candidates are going to be seeking solutions to save Chicago taxpayers money and stem rising taxes and fees.

KCB&A Claims Handling/WC Defense Can Save the City of Chicago Millions

In contrast, about a decade ago, Nathan Bernard & Shawn Biery from KCB&A took over handling of WC defense for a large central IL manufacturer. They have directed or helped to direct that program almost exclusively for the last 10 years.

About a year into their exclusive handling, a change in WC manager and Risk Overseer at that facility allowed them to more strongly implement our approach and we closed pending and aged WC claims favorably via hearings or disputed settlements to the extent that their open losses went from over 112 claims to under 35 over the course of about 4 years. Comparing those numbers to what I understand the City of Chicago’s claims count—similar handling would rapidly close around 2,000 pending files and save literally millions of dollars.

Going back to the manufacturer mentioned above, the continued efforts and change in WC claims culture maintained the lower loss runs to the extent that we were made aware of the significantly lower WC cost allocations for the facility which, combined with the lower overall WC costs simply due to lower claims, resulted in 7 figure savings.  If Nathan Bernard and Shawn Biery and the other members of our WC defense team were allowed to provide their genius to the City of Chicago’s WC claim culture, the savings could be in 8 figures.

Without having the room to provide every specific detail, their KCB&A program includes:

•                          Active assistance in developing strategies for investigation of claims

•                          Risk/Safety renewals at the company level

•                          Legal analysis to determine defenses and risks based upon our knowledge of the IL WC Arbitrators and general scenarios which result in benefits

•                          Augmented work accommodation and return to work strategies

•                          Better Medical Experts to match specific and challenging WC claims

•                          Surveillance, where appropriate

•                          Nurse case management to allow for the more rapid flow of information

Bring Injured City Workers Back to Desk Jobs, Please!!

My personal issue for all City of Chicago claims is getting injured workers back to modified work. This applies not only to the City’s WC program, it also applies to the Police and Firefighter Disability program—please remember City of Chicago police officers and firefighters are “exempt” by law from the coverage of the IL WC Act. In the past, they have been put on disability for years, sometimes decades while at the same time, the City is constantly seeking new 911 Emergency Dispatchers. A disabled City police officer or firefighter should require almost no training to transition to such sedentary positions. I don’t know why all the City’s 911 desks aren’t manned by recovered City workers—they are well-paid jobs with great benefits and match any work restriction.

KCB&A is Here To Help

We are ready, willing and able to join with the auditors, city officials, Corporation Counsel and outside vendors being asked to provide their best thoughts and strategies. If you know anyone involved in the City’s efforts to rebuild their WC defense program and save taxpayers money, please send a reply. If you need help cutting significant costs in your WC Defense Program in IL, IN, WI, IA or MI, let me know.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: En Banc Federal Seventh Circuit Court: Older Job Applicants Cannot Sue for Disparate Impact Age Discrimination. Analysis by Bradley J. Smith, J.D.

Editor's Comment: In Kleber v. CareFusion Corporation, the Seventh Circuit sitting en banc overturned a divided panel of its appellate justices. This opinion affirmed District Judge Sharon Johnson Coleman’s early dismissal of the age discrimination lawsuit. Early dismissal: much less money spent on defense fees and costs by the employer. Notably, the dismissal related to disparate impact age discrimination and not disparate treatment age discrimination. Initially, Plaintiff brought an Age Discrimination Employment Act (ADEA) claim. He originally brought the claims under §4(a)(1) and §4(a)(2) of the ADEA. §4(a)(1) is disparate treatment age discrimination and §4(a)(2) is based on disparate impact age discrimination. Disparate impact age discrimination is based on a company-wide policy that is claimed as discriminatory. Disparate treatment age discrimination is claimed as a single-subjective act or multiple subjective acts of age discrimination.

Plaintiff was a lawyer attempting to gain employment with CareFusion Corporation for a senior in-house position in CareFusion’s law department. The relevant job description underlying the claim required applicants to have “3 to 7 years (no more than 7 years) of relevant legal experience.” Plaintiff was 58 at the time he applied and had more than seven years of pertinent experience. Instead of hiring Plaintiff, CareFusion went with a 29-year-old applicant who met but did not exceed CareFusion’s experience requirements. Hence, this is why Plaintiff brought an disparate impact claim based on the job description and his application for that position. 

After Plaintiff brought his claims, CareFusion brought a motion to dismiss based on the Seventh Circuit’s prior decision in EEOC v. Francis W. Parker School. Prior to the district court deciding the motion, Plaintiff voluntarily dismissed the disparate treatment claim under §4(a)(1).  After that, a Seventh Circuit divided panel reversed the district court’s decision. Upon review, the Seventh Circuit sat en banc and extensively reviewed the language of the ADEA and Title VII of the Civil Rights Act of 1964. The pertinent language of the ADEA’s section 4(a)(2) makes it unlawful for an employer

to limit, segregate, or classify his employees in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s age.

29 U.S.C. § 623(a)(2).

The majority opinion written by Justice Scudder extensively analyzed that section and indicated that the plain language of that provision confined the prohibited conduct solely to employment status. So if you are not employed, then you cannot bring a §4(a)(2) ADEA claim.  Justice Scudder cited multiple canons of statutory construction throughout his majority opinion. Generally, every application of a text to a particular circumstance entails interpretation.

One of the canons he applied requires reading the text as a whole, and in the case that required the majority refrain from isolating two words when the language surrounding those two words supplied essential meaning and resolved the question before them. He went on to describe the construction of §4(a)(2). He indicated construction was clear from Congress’s use of language. The pertinent language Scudder examined was the provision covers “any individual” deprived of an employment opportunity because such conduct “adversely affects his status as an employee.” Put differently, ordinary principles of grammatical construction require connecting “any individual” (the antecedent) with the subsequent personal possessive pronoun “his,” and upon doing so we naturally read “any individual” as referring and limited to someone with “status as an employee.” Justice Scudder concluded the clear takeaway was that under §4(a)(2) a covered individual must be an employee.

That same portion of the opinion goes on to analyze Title VII’s amendments and that there was no corresponding amendment to the ADEA. Justice Scudder identified Congress’s choice to add “applicants” to §703(a)(2) of Title VII but not to amend §4(a)(2) of the ADEA in the same way as meaningful. The majority examined the precedent supporting using statutory amendments to support its position on the statutory language interpretation. The majority finally identified the solution to the problem as one of legislative prerogative. Justice Scudder disclosed that Congress remains free to extend §4(a)(2) to outside job applicants—similar to amending Title VII. Ultimately, the majority affirmed the district court’s dismissal.

It is quite possible the Supreme Court of the United States (SCOTUS) might take up this case on a writ of certiorari. Given the split in the circuits on this particular issue, SCOTUS may develop an appetite for whether §4(a)(2) of the ADEA covers applicants or non-employees. Indeed, SCOTUS might decide that they need to resolve the circuit split. Given Title VII’s interpretation, it is foreseeable that SCOTUS could overturn the Seventh Circuit’s recent decision. However, for now this is the law of the land in the Seventh Circuit (Indiana, Illinois, and Wisconsin). Given this, employers are currently free to have job application descriptions limiting experience and other matters, which could have an impact of older workers efforts to gain similar positions.

This does not mean a crafty plaintiff’s lawyer cannot create an argument under §4(a)(1) that there was disparate treatment of the job applicant. For instance, if there is an interview and the worker were asked age related questions or something similar that could be interpreted as falling within the purview of age discrimination under a disparate treatment theory, then that could still be actionable. A plaintiff’s lawyer will tell you there are multiple ways to “skin a cat.” And given the multiple ways to prove age discrimination, that admonition is no different here. 

We’ll continue to watch this decision closely as to whether or not further review from SCOTUS is sought. It is quite possible that another similar case could percolate up into another circuit court and then to SCOTUS. We’ll continue to report to our readers developments in this important area of employment law.

The research and writing of this article was performed by Bradley J. Smith, J.D. Bradley can be reached with any questions regarding the FLSA, employment law, and commercial general liability defense at bsmith@keefe-law.com.

Synopsis: Join KCB&A with the IL State Chamber for the IL WC Workshop on April 2, 2019 in Naperville. The link to register is: http://events.constantcontact.com/register/event?llr=omjkt4dab&oeidk=a07eg2i2618bf7c6629

Synopsis: Illinois WC Rates Jump Again—even with 313 residents leaving the state on average PER DAY, there was a jump in the Statewide AWW and Your existing PPD Reserves May Need To Be UPDATED RETROACTIVELY(!).

To any of our readers and/or fans, Send a Reply to Get a Free Copy of Shawn R. Biery’s Updated IL WC Rate-Sheet!

Editor’s comment: There continues to be an upward spiral of IL WC rates. Please don’t shoot the messenger for telling you how to get them right.

As mentioned before, twice every year, starting in the 1980’s, the IL WC Act provides a formula which effectively insures no matter how poor the IL economy is doing, your IL WC rates keep climbing.

We caution our readers to pay attention to the fact the IL WC statutory maximum PPD rate is now $826.79 (up from $790.64—a $36 increase when the last increase was only $15!!!).

When it was published, this PPD Max rate changed retroactively from July 1, 2018 to present. If you reserved a claim based on the prior rate for the period from July 1 to right now, your reserves are wrong.

If you have a claim with a date of loss after July 2017 and a max PPD rate, you need to take a look and see if the new maximum PPD rate applies.

The current TTD weekly maximum has risen to $1,506.81.

An IL worker has to make over $2,260.22 per week or $117,531.18 per year to hit the new IL WC maximum TTD rate.

The new IL WC minimum death or T&P rate also went up.

The IL WC minimum death benefit is 25 years of compensation or $565.06 per week x 52 weeks in a year x 25 years equaling a staggering $734,578.00! Yes, if Claimant makes $100 a week in a part-time job and dies in a work-related accident, the benefit is over $734K.

The new maximum IL WC death benefit is $1,506.81 times 52 weeks times 25 years or a lofty $1,958,853.00 plus burial benefits of $8K.

On top of this massive benefit, Illinois employers/governments have to contribute to a fund to pay COLA increases under the Rate Adjustment Fund that may double that already-high benefit, depending on the CPI.

The best way to make sense of all of this is to get Shawn Biery’s colorful, updated and easy-to-understand IL WC Rate Sheet.

If you want it, simply email Marissa at mpatel@keefe-law.com and include your mailing address if you would like to be mailed a laminated copy & you can also copy Shawn at sbiery@keefe-law.com with any questions, and his great team will get a copy routed to you before rates rise again.

Shawn remains your go-to defense source on any issue relating to IL WC rates!

Synopsis: Get your handy and updated 2019 Indiana Rate Chart Here. Research and reporting by Kevin Boyle, J.D., KCB&A’s Indiana WC defense team leader and Gene Keefe, J.D.

Editor’s comment: A new year, and our new 2019 Indiana WC Rate Chart is available. You can find it on our website, or if you’d like a laminated hard copy, please email Kevin and he’ll mail you as many as you and your staff need.  Happy New Year!  

Kevin Boyle, Esq., Keefe, Campbell, Biery & Assocs., LLC

885 South College Mall Rd. #222

Bloomington, IN 47401

Direct: 312.662.9899

Alternate: 812.369.7182

Email:  kboyle@keefe-law.com